Glencore announces coordinated settlements with US, UK, Brazil
Company expects to pay about $1.5 billion to settle probes
Glencore Plc admitted to bribery and market manipulation and said it will pay about $1.5 billion to settle US, UK and Brazilian probes that have hung over the commodities giant for years. The settlements will help remove a question mark that has long overshadowed the trader’s business. But the charges and admissions of guilt paint a damning, globe-spanning picture of how far the company, founded by U.S. fugitive Marc Rich, has been willing to go in pursuit of profit. NN: I have fought these pricks for years in our oil trades. Reality is they got off with a slap on the wrist. Like i say petty crime does not pay. Big crimes always pays… hence the trillion dollar funds and investment banks
IMF head warns of ‘biggest test since second world war’
Kristalina Georgieva says Ukraine conflict is ‘devastating lives, dragging down growth and pushing up inflation’ Gloom has descended on financial markets in recent months. Many analysts, business people and politicians think the resilience displayed in much of the economic data so far cannot last. A survey of chief economists of companies and international organisations undertaken by the WEF found that all had become more pessimistic over the past six months and now expected “moderate” economic activity in the US, China and most emerging economies. A “weak” outlook closer to the war in Ukraine in Europe was forecast. Inflation would be high everywhere outside Asia, with real wages falling amid rising food insecurity and higher energy prices. The impact of global supply chain disruptions and higher interest rates had also been exacerbated by the war, raising fears that the global economic recovery from coronavirus was about to stall. Increasing numbers of economists have become alarmed that the world is sliding towards a recession. Chinese production has plunged as Beijing tries to contain coronavirus through lockdowns, Europe is suffering from a cost of living crisis, the US risks moving from boom to bust and emerging markets face food shortages.
Speaking on a panel at the forum, Robert Habeck, Germany’s vice-chancellor and economy minister, said: “I’m really afraid that we are running into a global recession, with a tremendous effect not only on [the climate], but on global stability.”
Jane Fraser, chief executive of Citi, said there would be a recession in Europe and a downturn in the rest of the world. It’s a question of “Russia, recession and rates” all damaging activity, she added. Georgieva said the horizon had “darkened” since the IMF made its forecast of 3.6 per cent growth for 2022 in April. The consequences of Russia’s invasion were being seen “far and fast, with tightening financial conditions, US dollar appreciation and China slowing down”. “It’s going to be a tough year,” she said, with recession in some countries likely but not the average for the whole world. NN: best of times the worst of times. We had the greatest peace and property the wold has ever seen. With wide open borders allowing the free flowing of goods and most people on the planet. World hungers WAS at the lowest level ever and the most people in human history were lifted from poverty. That party is over. Its a mindless rush to starvation, oppression and poverty. A fine China hand painted ceramic tea pot is hard to make and easy to break
The head of the IMF has warned at the start of the World Economic Forum in Davos that the global economy faces perhaps its “biggest test since the second world war”. Kristalina Georgieva, IMF managing director, said Russia’s invasion was “devastating lives, dragging down growth and pushing up inflation”, and urged countries not to “surrender to the forces of geoeconomic fragmentation that will make our world poorer and more dangerous”. ” The sanctions have contributed to concerns, however, in the global economy that it is moving into a more turbulent period. Increasing numbers of economists have become alarmed that the world is sliding towards a recession, with Chinese production falling sharply as it battles coronavirus, Europe suffering from a cost of living crisis, the US moving from boom to bust and emerging markets facing food shortages. Georgieva urged all countries to lower barriers to trade, help countries in debt distress and modernise cross-border payments systems. But she warned: “There is no silver bullet to address the most destructive forms of fragmentation.” NN: Reality is the world is headed for a depression. It cannot be avoided. The food and energy crises plus supply chains imploding have set in motion a chain reaction that cannot be stopped. remember the US debt to GDP ration is over 125…the only civilized country in worse shape is Italy.
BERLIN (Reuters) – German Economy Minister Robert Habeck is disappointed that the EU has not yet agreed to an oil embargo targeting Russia, he said in a radio interview, adding that Germany would be willing to forego Hungary’s participation to speed up the proposed ban. “If the Commission president says we’re doing this as 26 without Hungary, then that is a path that I would always support,” Habeck told the Deutschlandfunk broadcaster ahead of talks with political and industrial leaders at the World Economic Forum in Davos.
“But I have not yet heard this from the EU,” he added.Among the 27 EU member states, Hungary is the most vocal critic of the planned embargo on Russian oil. NN: The EU is an example of a failed way of doing things. Governing by committee. Bottom line, other then McDonald’s hamburgers losing their branding sanctions are helping Russia. Putin is seeing a 100% rise in his new energy export revenue. No effect of banking sanctions and they have made the Ruble a world tradable currency at record high exchange rates…
A military plane carrying enough specialty infant formula for more than half a million baby bottles arrived Sunday in Indianapolis. It’s the first of several flights expected from Europe aimed at relieving a shortage that has sent parents scrambling to find enough to feed their children. NN: It has started the international relief supplies for the starving babbies of America….. Soon you will live with 3rd world shithole rolling blackouts. Food shortages, Masses of people living in tents……. And finally inserection as the starving masses invade your space…. Enjoy!!! Talk about reading the tea leaves…..
More than 1,000 respondents took part in weekly MLIV survey
Median prediction in poll is for S&P 500 to drop even further
Get ready for a fresh slump in the world’s most-watched stock index, as economic growth fears spiral and the Federal Reserve embarks on its biggest policy-tightening campaign in decades.
With the S&P 500 flirting with a bear market last week and notching more than $1 trillion in losses, participants in the latest MLIV Pulse survey reckon there’s more pain to come. The gauge is likely to keep falling this year before bottoming at around 3,500, according to the median projection of 1,009 respondents. That represents a decline of at least 10% from the Friday close of 3,901 — and a gut-wrenching 27% drop from the January peak. The Fed’s hawkish-at-all-costs posture, the chaos in supply chains and intensifying threats to the business cycle are all undermining confidence in Corporate America’s profit machine, while equity valuations keep sinking. After the longest run of weekly losses in more than two decades, just 4% of the MLIV readers reckon the S&P 500 has found a bottom for the year based on closing levels. And a handful see a historic rout in motion to 2,240 — re-testing the pandemic lows.
Money managers endured a worse drawdown in the Covid-spurred tumult of 2020, but that’s scant consolation with projected losses of this scale. “I still think the worst is not behind us,” said Savita Subramanian, head of US equity and quantitative strategy at Bank of America Corp., on Bloomberg Television Friday. “There’s a pervasive fog of negative sentiment out there.” Sobering profit assessments from the likes of retailer Target Corp. and network-equipment company Cisco Systems Inc. saw investors take the ax to share prices last week. Short interest in a popular exchange-traded equity fund jumped near levels last seen in March 2020. The renewed haven bid for US government bonds suggests money managers are getting increasingly fearful about the economic trajectory, with lockdowns in China and the prolonged Russia-Ukraine conflict taking their toll.
Most expect the index to fall another 10% or more
Source: MLIV Pulse Survey running May 17 – May 20. Respondents were asked ‘What will be the S&P 500 low in 2022?’
As the retail-stock meltdown kicked off last week, respondents became more bearish over the latter part of the May 17-20 polling period. On average MLIV professionals in the research, risk management and sales community were more pessimistic than their peers in portfolio management and sell-side trading. Asked which event will take place before the Fed shifts to dovish policy, 47% of respondents said they anticipated the S&P 500 falling 30% from its peak, while a similar proportion said US unemployment would rise to 6%, from 3.6% currently. More than 40% expect investment-grade credit spreads to blow out beyond 250 basis points before the monetary-easing cycle kicks in, while around one-in-four see American home prices tumbling 20%. Asked which asset class would need to see further declines before the risk-aversion cycle blows over, readers overwhelmingly cited equities, while housing, commodities and bonds also received submissions. Get ready for a fresh slump in the world’s most-watched stock index, as economic growth fears spiral and the Federal Reserve embarks on its biggest policy-tightening campaign in decades. With the S&P 500 flirting with a bear market last week and notching more than $1 trillion in losses, participants in the latest MLIV Pulse survey reckon there’s more pain to come. NN It will be a rough ride…… SO! we do rough. If i am guessing lucky looking into my crystal ball, reading the tea leaves, Summoning the Oracle of Delphi my guess is we are on the verge of capitulation. IF I GUESS LUCKY we are on the verge of a 2000 point drop. OF course we could get fucked and have the market ZOOM 1000 points against us….. (most likely) So we got another lottery ticket…. Lady luck don’t fail me know.
It’s been hard to watch, impossible to predict and a nightmare to trade. But has the S&P 500’s slide been an unqualified panic to date? By some measures no, and that might bode poorly for equities in the near term. Even with the US stock benchmark plunging 20% from a record for the first time since March 2020, trading volume has been pretty average and the Cboe Volatility Index is below this month’s highs. Meanwhile, the Cboe SKEW Index — implied volatility for bearish S&P 500 put contracts relative to calls — is close to two-year lows. The relative lack of anxiety isn’t necessarily a good thing, from contrarian lenses. That the S&P 500’s path has remained relatively orderly without any obvious sings of panic suggests that the bottom isn’t yet in view, according to AlphaTrAI’s Max Gokhman. Layer on a Federal Reserve that’s intent on looking past the turmoil in pursuit of tighter financial conditions, and the outlook is gloomy. “Investors holding their breath may wind up passing out because there’s more to this drop before the roller-coaster year starts grinding back up,” said Gokhman, the firm’s chief investment officer. “With the Fed as the ride’s operator, we shouldn’t expect a gentle glide back to the station. Only one-third of tightening cycles ended without a recession and they all started when inflation was under 3.3%.” The drop in stocks hasn’t been accompanied by a surge in trading. Volume on US exchanges hasn’t spiked this week as the S&P 500 fell another 4.8%. It’s remained in line with levels seen throughout the tumultuous year. “Volumes are not impressive or overwhelming. I prefer to see a volume surge to feel more confident about a bottom,” said Chris Murphy, co-head of derivatives strategy at Susquehanna International Group. “We typically see more volume at a real low as a sign of capitulation.”
“We have fear, we have doubt, we have angst, but we don’t have capitulation. We don’t have people dumping stocks yet, and I think that will come,” SentimenTrader’s analyst Jay Kaeppel said in a Bloomberg Television interview Friday. “Wake me when it hits 45, because if you look at history, all the big declines, it spikes to 40 or 45, so 30 isn’t going to do it.” The VIX is currently around 32. Julian Emanuel, chief equity and quantitative strategist at Evercore ISI, is watching three things for signs of capitulation: the VIX above 40, the put/call ratio reaching 1.35, and share volume above 20 billion. “The end of corrections are often accompanied by fear and capitulation — extreme volatility and trading volume,” he wrote in a recent note. Craig W. Johnson, chief market technician at Piper Sandler, is also looking for the VIX to hit 40, and is utilizing a proprietary technical indicator he’s dubbed the “40-week technique,” which measures how many stocks are above or below their 40-week moving averages. That gauge has dropped to 13% and he’s waiting for a “sub-10% washed-out reading.” “We have found readings below 10% have historically signaled the broader market is near an inflection point,” he wrote in a note. The Cboe SKEW Index — implied volatility for bearish S&P 500 put contracts relative to calls — is near the lowest since April 2020. Meanwhile, the put-to-call ratio that tracks the volume of options tied to individual companies has jumped to 1.27, still below the threshold Evercore’s Emanuel is watching for. “Even if index volatility isn’t cracking, you are seeing it in single stocks,” said Amy Wu Silverman, an equity derivatives strategist at RBC Capital Markets. “If single stocks is cracking, eventually this leads up to the index level.” Wu pointed to reactions in Walmart Inc. and Target Corp. as examples — both earlier this week posted their biggest post-earnings drops in decades. Mike Mullaney, director of global markets research at Boston Partners, says there’s potential for further margin contraction. “There’s probably more downside for the market right now than there is upside,” he said by phone. He’s going to be looking for analyst revisions to come down and valuations getting lower. “The $64,000 question is whether we can achieve a soft landing or are going to get pushed into a recession,” he said. “We’re more in the recession camp than we are in the soft-landing camp if the Fed wants to get to their inflation targets.” A recession could push the S&P 500 earnings multiple to around 13, and that could signal an area where “pretty much everything has been discounted in the market.” NN: To be clear here: I believe the market still has not factored in a run away inflation, energy shock, Fed raising rates induced recession. I believe the recession will come and end up in the mother of all great depressions……. And I have put everyone’s money where my mouth is… SO this could be painful as we lose our ass because we all know i am full of shit….. Thank GOD!
The EU has put an end to the lingering ambiguity surrounding how EU members can pay for Russian gas without violating sanctions. Russia has demanded that countries pay for its gas in rubles, although European governments have struggled to find a way to oblige Russia while not running afoul of sanctions. Further complicating matters—until now—was the EU’s lack of clarification on whether such an arrangement would violate the current sanctions. On Friday, Germany and Italy both told companies that they could open up rubles accounts in order to purchase Russian gas, in line with President Vladimir Putin’s request. Russia’s request has companies opening up two accounts at Gazprombank; one in euros or U.S. dollars and another in rubles. Buyers would deposit the payment into one account in U.S. dollars or euros, and then it is automatically converted to rubles without the involvement of the Bank of Russia.
As of last week, 20 companies in the EU had opened accounts at Gazprombank, while another 14 had asked for the necessary paperwork to open up accounts. Germany’s VNG had already opened up an account with Gazprombank.
With the EU now clarifying that such an arrangement would not violate sanctions, additional companies are expected to file paperwork to open up ruble accounts.
But so far, Bulgaria, Finland, and Poland have refused to pay with ruble accounts. Russia has already cut off supplies to Bulgaria and Poland, and Russia s cut off gas supplies to Finland on Saturday. According to Reuters, the EU has so far given out contradictory information, one version in writing on how to buy gas from Russia without violating sanctions, and a contrary version in a closed-door meeting that cautioned EU members not to open ruble accounts with Gazprombank. NN: A total surrender to Russians Putin. Its long been a dream of Russia to sell its oil in Ruble’s. And the complete failure of the EU sanctions made a Russian dream come true. Since Europe has sanctioned Russia oil has gone from $70 a barrel to $112. And the stupid economic sanctions have really helped Russia. At the start of the war the Ruble at .78 to the dollar. When sanctions were announced the Rubble plunged and it took 150 Rubles to buy a dollar… A killer! Now that Russia has won another chess match the Ruble is at a record high against the dollar trading at 62 Ruble’s to the dollar. By successfully forcing buyer to pay in Rubles Russia has doubled the value of its currency. So in essence Europe is paying the equivalent of $150 a barrel…. What fucking idiots. The numbers look even better for natural gas. In essence the stupid fucking headline grabbing politicians has see\en to it that 25% of the worlds oil and gas are no longer purchased in dollars or euros but Rubens. That amounts to hundreds of billions of dollars supporting the Ruble, And establishing it as a world class currency. Hey Euroidiot you sure showed him. Putin is saying if i new this would have happened i should have continued my invasion 10 years ago and not stopped with the Crimea.
The S&P 500 index refuses to fall into a bear market—but that doesn’t mean it’s found a bottom just yet. Not that it wasn’t a painful week. The S&P 500 dropped 3% and has now fallen 18.7% from its Jan. 3 all-time high. A slide of 20%, which it touched Friday before bouncing back, signifies a bear market. The Dow Jones Industrial Average declined 2.9%, its eighth consecutive week of losses, matching its longest losing streak since 1932. The Nasdaq Composite, already in a bear market, slid another 3.8%, and is down 28.2% from its early January peak. With losses like that, we’d expect to find an end-of-the-world headline that drove the selloff, but good luck finding any single trigger for the week’s carnage. Instead, it was an accumulation of news that seemed to weigh on the markets. Federal Reserve Chairman Jerome Powell spoke about the need to keep raising interest rates, while Target (ticker: TGT) and Walmart (WMT) not only reported earnings that disappointed but offered commentary that suggested U.S. shoppers are finally feeling the impact of rising prices. Perhaps the only good news was a strong retail sales report, though that was also bad news in an environment in which the Fed needs to slow growth to combat rising inflation. Ultimately, there was no place to hide, and even previously strong performers seemed to finally capitulate. The Dow Jones Transportation Average dropped 6.7% on concerns over a shipping recession, after having declined just 12% entering the week. The Consumer Staples Select Sector SPDR exchange-traded fund (XLP) entered the week nearly flat on the year, but dropped 8.1%, with Procter & Gamble (PG) falling 7.7% and Hershey (HSY) tumbling 8.4%. “When you can’t hide in Hershey, you pretty much can’t hide,” says Frank Gretz, market analyst at Wellington Shields. And for good reason. Walmart and Target aren’t just anybody. They’re not highflying tech stocks with nosebleed valuations and no profits or weak businesses just trying to scrape by. They are among the best-run companies in the U.S., and they’re demonstrating that it’s nearly impossible to manage well through the current environment of high inflation, supply-chain disruptions, a tight labor market, and rapidly shifting consumer preferences. But the big drops in previous winners could be good news, if it means that investors are finally capitulating and bringing the market closer to that elusive bottom. “In order for pessimism to reach true panic levels, investors need to fear there’s no place to hide,” says Ed Clissold, chief U.S. strategist at Ned Davis Research. “And that includes even some viewed as untouchable companies.” Other signs of a possible bottom nearing are starting to emerge, as well. The S&P 500 now trades at just 16.6 times 12-month forward earnings, down from 21.5 times at the start of the year and “only a touch above the long-run average,” writes Manish Kabra, head of U.S. equity strategy at Société Générale. “The correction has literally vaporised the valuation froth in the S&P 500.” Looking for more? Sentiment is also at ridiculously low levels—and that usually suggests it’s time to buy. Michael Hartnett, chief investment strategist at BofA Securities, noted that the BofA Bull & Bear Indicator recently tumbled to 1.5 from 2.0, putting it in “unambiguous contrarian buy territory.” That wasn’t enough for Hartnett, however, who explained why the market is likely to fall even further. Over the past 140 years, U.S. bear markets have lasted an average of 289 days and fallen 37.3%. That would put a bottom for the S&P 500 at around 3000, down 23% from Friday’s close of 3901.36. A bottom might be closer than that, however, especially if one thinks in terms of waterfalls, not bears—not because rushing water is relaxing in turbulent times, though it is, but because that’s what this selloff has come to resemble. Ned Davis’ Clissold defines a “waterfall decline” as one with persistent selling, big bounces that don’t last, and then, even more selling. Historically, they’ve lasted about 40 calendar days, with an average drop of 24.6%, while also seeing a surge in trading volume. The current decline has been long enough but not deep enough, so he isn’t recommending buying stocks just yet. “We don’t adhere to catching falling knives,” he says. Clissold knows what he wants to see—a couple of days of strong buying, when gainers outpace losers by 10-to-1, with no 10-to-1 down days in between. “The selling pressure needs to transition to persistent buying pressure,” he says. There are other signals to watch for a bottom. Evercore ISI strategist Julian Emanuel points to the Cboe Volatility Index, or VIX, topping 40, a put-call ratio over 1.35, and a large volume day, perhaps one that exceeds January’s peak, as signs that the selloff is nearing its end. What investors don’t want to see is persistently strong retail sales or other signs that the Fed will have to stay aggressive with rate hikes and quantitative easing. “The Fed has this incredibly difficult balancing act to pull off,” he says. When the bounce does come, don’t be surprised if it is explosive. For instance, the S&P 500 has fallen for seven consecutive weeks. Following the end of its three previous losing streaks of seven weeks or more, the index went on to gain an average of 39%, observes Frank Cappelleri, chief market technician at Instinet. “While the historical sample size is small, when the previous long losing streaks ended, they were followed by exceptionally strong rebounds—regardless of the current market’s overall trend,” he explains. NN: Obviously Friday was fireman to the rescue. Incredible buying came in on the close…. The question is will the buying continue for the next two weeks. If it does we will lose our ass, And the market could access the situation and realize the peril it is in. And it COULD crash. Tripping circuits breakers all the way down. Talk about wishful thinking on my part. Prepare to lose your ass in this trade.
OSLO (Reuters) – Russia’s Gazprom on Saturday halted gas exports to neighbouring Finland, in the latest escalation of an energy payments dispute with Western nations. Gazprom Export has demanded that European countries pay for Russian gas supplies in roubles because of sanctions imposed over Moscow’s invasion of Ukraine, but Finland refuses to do so. The move by Gazprom comes at the same time as Finland is applying to join the NATO military alliance, a decision spurred by Russia’s invasion of Ukraine. “Gas imports through Imatra entry point have been stopped,” Finnish gas system operator Gasgrid Finland said in a statement on Saturday. Imatra is the entry point for Russian gas into Finland. Finnish state-owned gas wholesaler Gasum on Friday said Gazprom had warned that flows would be halted from 0400 GMT on Saturday morning. Gasum and Gazprom also confirmed on Saturday the flows had stopped. “Natural gas supplies to Finland under Gasum’s supply contract have been cut off,” Gasum said in a statement. “Starting from today, during the upcoming summer season, Gasum will supply natural gas to its customers from other sources through the Balticconnector pipeline.” Balticconnector links Finland to neighbouring Estonia’s gas grid. Gazprom Export on Friday said flows would be cut because Gasum had not complied with the new Russian rules requiring settlement in roubles. The majority of gas used in Finland comes from Russia but gas only accounts for about 5% of its annual energy consumption. Most European supply contracts are denominated in euros or dollars and Moscow already cut off gas to Bulgaria and Poland last month after they refused to comply with the new payment terms. Gasum, the Finnish government and individual gas consuming companies in Finland have said they were prepared for a shutdown of Russian flows and that the country will manage without. “The Finnish gas system is in balance both physically and commercially,” Gasgrid said on Saturday. Finland on Friday said it had agreed to charter a storage and regasification vessel from U.S. based Excelerate Energy to help replace Russian supplies, starting in the fourth quarter this year. The vessel turns supercooled, liquefied natural gas (LNG), which arrives on ships, back into regular gas. NN: What are they smoking???? they claim losing all their gas imports from Russia is not a problem, because in the 4th quarter (in 7 moths) A regasification plant (that turns Liquid natural gas beck into gas) will be working. And they will get the liquefied natural gas from Biden’s America. BUT sources i have talked to are laughing because the US does not have the resources (pipelines, LNG plants, Ships) to supply all the LNG Biden has promised to Europe….
